According to user reports circulating on social media, cryptocurrency exchange Crypto.com plans to delist Tether (USDT) for Canadian users starting Jan. 31. The exchange has informed its customers that if they do not withdraw or convert their USDT holdings by the deadline, their tethers will be automatically converted to USD Coin (USDC). It writes:
“You may incur a retrieval fee if deposits of USDT are made from external wallets after this suspension period, and fund retrieval may not be possible in some cases.”
In August 2022, Crypto.com announced that the Ontario Securities Commission accepted the company’s pre-registration commitment to do business in Canada. As part of the regulatory requirements, cryptocurrency exchanges operating in the Canadian province of Ontario are prohibited from listing digital assets banned by the OSC, including USDT. Likewise, Coinsquare, a cryptocurrency exchange regulated by the Investment Industry Regulatory Organization of Canada (||ROC), does not currently list USDT as one of its available trading assets.
In issuing its decision, the OSC never explained the rationale for its Tether ban. However, a document unsealed on February 17, 2021 states that “the only US$ held by Tether, which is said to be backing the roughly 442 million Tethers in circulation, are roughly US$61 million in deposits with the Bank of Montreal “. have questioned the veracity of Tether reserves and their audits.
Crypto Community Reacts to Crypto.com Delisting USDT
For many users, USDT’s delisting in Canada is seen as a taste of what could happen globally if regulators in other countries decide to crack down on cryptocurrencies with stricter regulations.
Some people also believe that the reason for the delisting is that Crypto.Com has a good relationship with Circle, the USDC issuer, and it’s simply a matter of eliminating the competition. Very similar to what Binance did with USDC. Meanwhile, other users reported that USDT’s delisting was “a big problem for Canadians” as they would have fewer opportunities to earn interest.
While the vast majority were dissatisfied with the actions taken by Crypto.com, other users said that regulation is the only way for wider cryptocurrency proliferation and for big players to enter the ecosystem.